Retinoids exert profound pleiotropic effects in skin, affecting many aspects of cell differentiation and proliferation. For this reason, retinoids have prominent pharmacological effects on major skin cells (keratinocytes, dermal fibroblasts, melanocytes, sebocytes) and have shown great potential as therapeutic agents in dermatology. In keratinocytes, retinoids induce proliferation, resulting in epidermal hyperplasia. Retinoids also modulate epidermal differentiation, however, many of the suppressive effects of retinoids observed in vitro do not occur in vivo. Dermal fibroblasts are important target cells of retinoids and are stimulated to produce extracellular matrix proteins, particularly when skin is damaged by wounding, ultraviolet radiation or glucocorticoids. Retinoids regulate pigmentation and can lighten hyperpigmented skin in animals and humans. Studies with cultured melanocytic cells show that tyrosinase activity is reduced by retinoids. The powerful sebosuppressive effect of some retinoids, such as 13 cis-retinoic acid, demonstrates that sebocyte differentiation is altered by retinoids. Retinoids inhibit proliferation and lipid synthesis in cultured human sebocytes and alter their keratin expression.